Is It the Best Time To Buy Ethereum?

Ethereum (ETH), the second-largest cryptocurrency by market capitalization, has been in an interesting position lately. Despite its fundamentals reaching all-time highs, its price remains significantly below what it could be.

This gap between value and price presents a unique opportunity for investors who can see beyond short-term market noise. Let’s explore the key factors that make Ethereum an attractive investment option right now.

Historically strong fundamental indicators

Ethereum’s fundamentals have never been stronger, surpassing its previous records. Data shows that Ethereum is performing at its peak. For instance, the number of active monthly users has exceeded 25 million, marking a multi-fold increase compared to four years ago.

Additionally, the total value locked (TVL) in decentralized finance (DeFi) protocols on Ethereum has reached $48.88 billion, higher than any point during 2023.

This indicates that investors continue to place their trust in Ethereum as a platform for DeFi, further enhancing the network’s stability and value.

ETF approvals and future price potential

The approval of several spot ETH ETFs has brought mixed market reactions. While some funds have seen outflows, others, like BlackRock’s iShares Ethereum Trust, have experienced positive inflows, signaling increasing interest from institutional investors.

If these ETFs continue to attract inflows, they could strongly support ETH’s price, which remains well below its all-time highs.

ETFs make it easier for both institutional investors and retail participants to invest in Ethereum without holding the cryptocurrency directly, thus expanding access to this asset class. This increased demand could drive price growth, helping Ethereum’s price catch up with its strong fundamentals.

Key levels to watch

ETHUSD - 1 Week Time Frame

From a technical perspective, despite a corrective move starting in March, Ethereum’s price remains in a bullish market structure. This correction presents a buying opportunity as the price has fallen below the key Fibonacci level of 0.5, entering the Discount zone.

Institutional participants, trading in high volumes, often target liquidity zones around old lows and highs. To confirm a buy entry, ETH must close above the orange resistance zone.

The key level to monitor is the higher low, represented by the lower blue line on the chart. As long as Ethereum trades above this level on the weekly timeframe, it remains technically bullish.

When to buy Ethereum?

Despite Ethereum's strong fundamentals, its price has remained relatively stagnant, offering investors the chance to buy at lower levels.

The rising number of active users and increasing TVL show the network's strength and potential for continued growth. If these fundamentals hold, it’s likely that Ethereum’s price will eventually catch up.

Furthermore, institutional adoption through ETFs could bring significant capital into the Ethereum ecosystem, potentially triggering a resurgence in price activity.

With fundamentals at an all-time high, now could be the ideal time to capitalize on the mismatch between Ethereum’s current price and its true value, making it an attractive investment opportunity for long-term growth.